Is Octaware Tech. overvalued or undervalued?

Aug 09 2025 08:05 AM IST
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As of August 8, 2025, Octaware Tech. is considered overvalued and risky, with key financial ratios significantly lower than its peers, a poor return profile, and a year-to-date stock return of -62.4% compared to the Sensex's 2.20% gain.
As of 8 August 2025, Octaware Tech. has moved from an attractive to a risky valuation grade. The company is currently assessed as overvalued based on its financial ratios and peer comparisons. Key ratios include a PE Ratio of 9.14, an EV to EBIT of 8.36, and a Price to Book Value of 0.68, which are significantly lower than those of its peers such as TCS with a PE Ratio of 22.28 and Infosys at 21.71.

In comparison to its industry peers, Octaware Tech. exhibits a concerning financial profile, particularly with a Return on Capital Employed (ROCE) of only 1.50% and Return on Equity (ROE) of 2.08%. This underperformance is further highlighted by the company's year-to-date stock return of -62.4%, contrasting sharply with the Sensex's positive return of 2.20%. Overall, these factors indicate that Octaware Tech. is overvalued relative to its peers and market conditions.
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Our weekly and monthly stock recommendations are here
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